Life Insurance in Denmark Shows Vital Signs of Recovery: Ken Research

The Danish life insurance industry, which is becoming more competitive, is expected to grow at a healthy CAGR, thanks to the increased competition and the increased risk coverage offered by life insurance companies.

In the recent past, insurance companies in Denmark have faced obstacles due to the European debt crisis and their own financial problems. Fall in equity and bond prices has led to losses in the insurance industry. As the life insurance market starts moving on the road to recovery, Ken Research analysts expect Danish insurance companies to increase their policy prices and also try to expand their consumer base. This will lead to improvements in insurance benefits and more insurance coverage over the forecast period.

Regarding prospective changes in insurance policies to be offered by Danish customers, analysts say that the life insurance companies in Denmark are likely to shift from traditional insurance contracts which provide minimum-return guarantees to more transparent products, where the insured bears more of the investment risk.

In line with their focus on marketing, life insurance policies as a savings instrument, Danish life and group superannuation insurers are now offering such products that are more transparent than traditional products.

Analysts feel that the Danish people will be more motivated to invest in life insurance, as there is improvement in the financial sector and economic recovery in Europe along with increased disposable income and standard of living. Also the declining inflation will leave more money in people’s hands thus encouraging them to invest in savings products and insurance.

The report titled “Life Insurance in Denmark, Key Trends and Opportunities to 2020” says that, a pension is the financial backbone of a retired person. In the Danish life insurance segment too, pensions account for a major share, and analysts believe that pensions will play a pivotal role in driving the life insurance segment during the forecast period. The sale of life insurance policies in Denmark is predominantly through direct marketing followed by bancassurance and through agencies. Direct marketing is the most successful platform for creating new markets for life insurance. The next best medium is bancassurance and selling policies through agencies is at the third place.

Moving with the times, Danish life insurance companies are making arrangements to do more and more transactions online. They have developed mobile apps and other online portals to directly market their products online.

Overall, the life insurance industry in Denmark is going to grow at a healthy rate with major market drivers being financial recovery and increased disposable income in the hands of consumers.

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